During the past few years the magnetic circular dichroism effect (MCD) has become an increasingly important tool for studying magnetic materials and their surfaces. The employment of MCD is based on the use of circularly polarized soft x rays, which can be obtained from electron storage rings. Circularly polarized x rays appear either as off-plane bending magnet radiation or radiation from special undulator devices, e.g., crossed or helical ones. However, an unsolved problem has been the independent and simple measurement of the polarization of this radiation. At BESSY, we have developed a new compact polarimeter. The instrument consists of four major elements. There are (i) a pinhole to select the desired part of the photon emission cone and (ii) a 100-period Cr/C multilayer to serve as a monochromator with a spectral resolution power of 50. The angle of incidence is set to 15.9° to meet 718 eV photon energy that corresponds to a maximum MCD effect close to the Fe 2p threshold excitation energy. There are also (iii) a 50 nm Fe film on 3 μm Mylar foil to show the MCD effect in photon transmission (the foil is mounted under 45° to the photon beam and can be magnetized in the plane of the Fe film) and (iv) a Si-pin diode to measure the transmitted photon flux. The assembly fulfills the following requirements: (1) insensitive to linearly polarized and unpolarized light, (2) performance at high heat load, (3) reliability and long term stability also in air, (4) wavelength sensitivity, and (5) fast readout capability. In future work the polarimeter can be employed for the characterization of helical undulators such as the BESSY II UE56, which cover the range of the Fe 2p threshold. With foils of other transition metal or rare-earth materials, the sensitive photon energy range can be extended.